Australian government curbs the law re bonuses

[malaise]

Shareholders must approve any bonus worth more than one year's salary.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aUBEYC4zryCc&refer=home
<snip>
Under the proposed law, shareholders would need to approve termination payments that exceed one-year’s salary, rather than the current seven-year threshold and curbs on severance pay could be linked to job losses, Swan said. The government’s Productivity Commission will also hold a nine-month inquiry into executive remuneration and bonuses.

Australia’s curbs come after news that underwear maker Pacific Brands Ltd., which last month cut 1,850 jobs, paid former Chief Executive Paul Moore A$5.8 million ($3.9 million) in the year ending June 30, 2008. Hundreds of sacked workers protested and Swan called the payouts “frankly sickening.”

Newspapers including the Sydney Morning Herald reported on Feb. 27 that Telstra Corp. Chief Executive Officer Sol Trujillo would walk away from his stint in Australia with A$40 million in cash and shares when he leaves the post on June 30. In fact, Trujillo will receive a one-time payout of A$3 million upon departure, Telstra said today.

“Shareholders are being given the final say on golden hand shakes because of boards’ chronic failure to act,” Australian Shareholders Association chief executive officer Stuart Wilson said in an e-mailed statement. Still, “before the ink is dry on the legislation there will be an army of lawyers and remuneration consultants looking for ways to avoid it.”
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Is there an American Shareholders Association?

Looks like all it takes to act is a government that represents all its citizens.

[soothsayer]

1. we already own 80% of AIG. doesn't that give us control?

[malaise]

2. Apparently AIG bought the politicians first

:shrug:

[depakid]

3. "Looks like all it takes to act is a government that represents all its citizens."

It also helps to have the Green party pushing the issue and keeping Labor honest.

Australian Greens Leader Bob Brown has criticised the federal government's crackdown on the “obscene” salaries paid to company executives, saying it is far too slow.

Senator Brown said while the Greens supported a move to regulate so-called golden parachutes, the decision to put off tackling general pay packets for nine months was pandering to the big end of town.

The government announced on Wednesday it plans to introduce legislation that would see shareholder approval required for termination payments exceeding one year's base pay.

Under current laws, company directors can receive payouts seven times their total annual remuneration on termination of a contract.

The government has also referred the broader issue of executive remuneration to the Productivity Commission, which will provide a final report within nine months.

“The prime minister has fallen into the trap of put off, fudge, dither, delay what the Australian people want, and that is action on the most obscene payouts to CEO’s at a time when the economy is in real trouble,” Senator Brown told reporters in Canberra.

“These multi-million-dollar CEO’s will not be waiting nine months to sack thousands more of their fellow Australians.”

more: http://www.thewest.com.au/default.aspx?MenuID=3&ContentID=130891

He was also having a go with Rudd on the 730 Report yesterday....

[malaise]

4. Good post

Thanks. :hi: